DaimlerChrysler shuns City

Motor giant’s legal chief blasts City service; Herbert Smith, Richards Butler dumped for regional firms

DaimlerChrysler UK (DCUK) has turned its back on the City following a sweeping review of its external advisers.

Following a lengthy tender process, DCUK has sidelined Herbert Smith and Richards Butler, which historically advised it on litigation and competition law, in favour of Pinsents and Shoosmiths.

Addleshaw Goddard and Howes Percival, which previously advised DCUK on product liability and real estate respectively, also lost out.

The review was launched by DCUK general counsel Chrissi Evans because of her dissatisfaction with the quality of the legal advice she was receiving from City firms. She did not invite any large City firms to participate in the tender exercise.

Evans attacked City firms for being too expensive and for not treating DCUK as an important enough client.

“[City firms] have a high cost per hour, and because of their desire to do a perfect job, a small job became a very big job,” said Evans. “I didn’t feel we were clocked as a very important client. I want our advisers to be as enthusiastic about our products as I am.”

She also criticised City firms for their lack of commerciality and said sometimes their advice sounded like it came straight out of a legal textbook.

Charles Russell, Eversheds, Lawrence Graham, Lewis Silkin and Wragge & Co also participated in the beauty parade. “Pinsents and Shoosmiths stuck out because both firms demonstrated a clear understanding of the relationship issue,” said Evans.

The appointments run from January 2005 for three years. As well as DCUK, the firms will also act for DaimlerChrysler Retail and DaimlerChrysler Services.

Dorsey & Whitney will continue to advise DCUK on IP issues, which were beyond the scope of the review.

DCUK is responsible for the distribution, sales and marketing of all DaimlerChrysler products in the UK. Its brands also include Mercedes-Benz and Jeep.

Herbert Smith and Richards Butler did not return calls for comment.